FAQ(Nikkei Stock Average Dividend Point Index)

Nikkei Inc.

(October 1, 2021 version)

QA-DP0-E-20211001

1. What is the “Nikkei Stock Average DP” appeared in the newspaper, i.e. Nihon
Keizai Shimbun (in Japanese) ?
The Nikkei Stock Average Dividend Point Index (DP), indicates how much dividends
investors could receive during a year if the Nikkei Stock Average, the Nikkei 225 isused to resemble a stock. The dividend index is calculated by accumulating the each
received dividend every time the amount is fixed if they are supposed to hold the 225
constituent stocks from January to December in a year. Nikkei started calculating andpublishing the index from April 2010.
2. Why is some year figure, e.g. 2012 put with the index ?
This is because the index is calculated by accumulating the amount of constituent
stocks’ dividends in each year. For instance, the Nikkei Stock Av erage Dividend Point
Index (2012) represents the accumulated amount of dividends in case investors a resupposed to hold the constituents of the Nikkei 225 between January and Decemb er
2012. Based on current constituents, the index firstly includes the interim dividendby a company with the account month of February, the second quarter. After it finallyincludes the fixed dividends by companies with annual accounting month of December,the year’s final index value is determined at the beginning of April in the followingyear.
3. What would the index value indicate ?
It indicates the accumulated dividend amount in case of holding the constituents of
the Nikkei 225 with the same weights as those used for the calculation of the Nikkei225. Therefore after the each stock’s dividend is adjusted by the price adjustment
factor, then the adjusted value is divided by the divisor on the ex -dividend day, andthen the figures are accumulated to obtain the index value. It represents so called anincome gain (dividend) in using the Nikkei 225 to resemble a stock.
4. When would the value be changed ?
The year-end dividends are included on the next day of the annual regular shareholder
meeting, while the dividends for other periods, i.e. interim dividends are included on
the next day when the figures are published by t he companies. Because most of theconstituents have annual accounting month of March, the index tends to increase inJune and October to November when the year-end dividends and the interim dividends
are fixed respectively.
5. Is it possible to obtain the past data ?

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2Yes. You can obtain the daily data for the past three years free of charge through apage of the Nikkei Stock Average Dividend Point Index or Download Centers in“Indexes” page on this web site. The index value since 1998 or the individual di vidend
figures to compute and track the indexes are provided on “Premium Data Package”,paid information pages on this web site.
6. Are there any financial products linked to the index ? What is the purpose forthe usage ?
Futures on the Nikkei Stock Average Dividend Point Index are traded where investors
predict the final value of the dividend indexes of the years. Such future contracts havebeen traded on the Osaka Exchange (OSE) and on the Singapore Exchange (SGX). The
OSE lists the eight contracts and the SGX lists ten contracts respectively. Major
participants are financial institutions such as institutional investors however somesecurity brokers started taking orders for individual investors. The dividend futures
tend to rise if investors expect dividends to increase, while the futures would fall if they
expect dividends to decrease. They could gain by selling some future contracts based on
the expectation for dividends to decrease, then buying them back at the lower pr ices asexpected, which could cover losses due to decreases in dividends. Also investors buying
products linked to the Nikkei 225 could use the future contracts to fix and cash in therealized return, or to avoid the risk in the fluctuation of the dividend in the future.

Copyright 2021 © Nikkei Inc. All rights reserved.

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